UK To Hit Business Aviation with Passenger Tax

The UK government has confirmed its intention to extend its existing air passenger duty (APD) to business aircraft users. Chancellor of the Exchequer George Osborne confirmed the decision in his fall economic statement in parliament on Tuesday.

More details as to how the new tax will be imposed are to be announced on December 6, but the British government already has confirmed that the duty will not take effect until April 2013.

The move follows a consultation process launched by the UK Treasury in April. According to the Treasury’s November 29 statement there is “a strong fairness argument for extending aviation taxation to many thousands of private passenger flights on aircraft (including helicopters) below the present weight and passenger seat de minimis limits (‘business jet flights’).”

The duty will apply for aircraft weighing more than 5.7 metric tons (12,500 pounds). The proposal is to have a single rate of duty per passenger in 2012 and 2013, irrespective of distance traveled, equivalent to the highest rate of APD, which from April 2012 is to be increased from £170 ($263) to £186 ($288).